The Story is the Business, Not the Stock Price

It’s long been said that today’s headlines make tomorrow’s trash. If your company is struggling today, make the focus of your investor communications what you’re planning to do for tomorrow. What’s the long-term strategy of your company? During this year’s AGM season, many companies have found themselves in a position less likely to attract investment, and more likely to attract criticism. Though investors will want details on, and an explanation of the current stock price, smart CEOs will choose to focus on the real story: the long-term strength of the business.

Never lose sight of your long-term business plan – no matter how your company is performing. This will help you rise above your competition and any hardships you may encounter along the way.

Methods of Investor Communications

An effective communications strategy for the long term ensures you always maintain consistent communications with your audience, which of course includes your investors. What sets the investor relations strategy apart from your company’s overall communications strategy is that your investors are looking more at the numbers, and because of this, your investor relations will be more focused on financial communications.

But perhaps just as important are the following questions:

• Who is running the show? Who is managing the company, and are they doing a good job?
• How healthy is the company — financially, and from a management standpoint?

A few examples of methods you can employ to communicate with your investors…

• Shareholder meetings
• News conferences (less common but sometimes necessary)
• Investor briefings — a one-on-one call with key investor analysts, perhaps as often as once a week
• Your website — make sure it’s up to date
• Social responsibility report (as part of the annual report) — explains the social and environmental philosophies of your company and can attract investors based on ethics, environmental policies and community investment strategies
• And at the very minimum, your annual report

So What Makes a Healthy Investor Relations Strategy?

Investors are not only looking for numbers, though that is at the forefront. They are looking at the issues that reflect the stability of a company: corporate governance; how the company is dealing with any public relations issues that come up; the handling of regulatory issues; and how well the company is managing its reputation. Investors may be anywhere around the world, and they need to understand the issues and be comfortable that a company is managed in a satisfactory way before wanting to invest.

A social responsibility report might be an important part of your annual report, depending on your industry. This report speaks to the philosophies of the company and explains what you are doing from a social perspective as well as an environmental perspective, to offset emissions, to invest in the community, and so on.

The story is the business, not the stock price — how are you managing your business regardless of today’s stock price? People invest for the long haul; they want to know that your company has the governance, strategies and ethics in place to pay off over time.